2014-05-20

MUSIC Group and Guitar Center Part Ways (PDF)

We were surprised by a recent public statement issued by Guitar Center. Over the last year, due to GC’s highly publicized financial situation, we were forced to evaluate their credit worthiness. As a result of their credit rating, it was determined that they were a high risk and we were forced to put them on business hold. We certainly respect GC’s decision to discontinue business with us and we thank them for our excellent 20 year relationship.

Over the past 25 years, MUSIC Group has seen tremendous growth and has become one of the largest Pro Audio companies in the world. The Company experienced a historical record revenue last year and also celebrated an all-time record revenue in April in the United States.

Since its introduction in 2012, the X32 has become the world’s best-selling digital mixing console and with over 150,000 units sold, it has far exceeded all expectations. In recent years, MUSIC Group acquired the iconic brands Midas, Klark Teknik and Turbosound which have also experienced unprecedented growth.

MUSIC Group has invested over US$ 100 million in the industry’s most advanced and automated manufacturing facility which is scheduled to open later this year. The massive 3 million square foot campus demonstrates our long-term commitment to innovation, quality and highly competitive products.

We are committed to our customers receiving products at “Double the Experience for Half the Price,” while our business partners enjoy healthy profits and unprecedented sell-through.

Our US distributor Starin is in the process of rolling out a new free-freight program as well as extended payment terms, making it even easier to get access to our high demand products.

I want to personally thank all our US dealers for their tremendous support and loyalty.

Onwards and upwards!

MUSIC Group

Uli Behringer

Chief Executive Officer

2013-12-09

MUSIC Group City Construction In Full Swing

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High-tech campus construction scheduled for completion in mid-2014

Zhongshan, China – Just over a year after breaking ground on a massive new campus that will become home to up to 10,000 employees, MUSIC Group founder and CEO Uli Behringer is excited about the progress made on the site – and the fantastic prospects for the Company's future.

“I'm thrilled to see the progress on this wonderful new manufacturing facility called MUSIC Group City," said Uli Behringer. "My dream has always been to help talented musicians reach their goals. Seeing this campus coming to fruition is gratifying – and we can hardly wait to see this place come to life!

We have spent over 2 years blue-printing and fine-tuning every single aspect of the plant's design. Several specialized Japanese process engineering firms have been engaged to create one of the most efficient, automated and environmentally friendly manufacturing plants in the world. We also spent substantial resources on the industrial design, which show-cases massive glass-curtains and aluminum-braced facades. We even added internal factory walk-ways for visitors to witness every aspect of our high-tech production - an inspiring customer experience that manufacturers like BMW and Volkswagen have pioneered."

Uli Behringer continuous: "24 years ago, we were the first company in our industry to move manufacturing to China and it has been an incredible learning experience. It is interesting to me that most of our competitors have outsourced manufacturing, something we would never do. In-house manufacturing is the only way to control and deliver consistent quality. Our continued investments in automation, optical and X-ray inspection devices, rigorous lifecycle testing equipment, and in-house quality assurance have resulted in failure rates that are among the lowest in the industry. We even built a comprehensive EMC and UL-approved safety lab to do rigorous and comprehensive compliance testing that goes way beyond the regulatory requirements. As a result, we now offer a 3-year Warranty Program for all our products."

Undertaken in September of 2012 with a gala cornerstone ceremony, the main building will be an enormous, 3 million square foot structure supported by 2,500 support beams, with a total combined length of more than 40 miles (65 km). When complete, the US$ 70 million, 70-acre complex will include a dedicated factory space housing more than 100 automated manufacturing lines, fully automated transducer production lines, injection molding and hydro-forming facilities plus a total "clean-air" wood products and painting pavilion. On site will also be a single-story, fully automated warehouse directly connected to an on-line B2B Partner Portal that allows real-time ordering and distribution.

Along with the expanded manufacturing capacity, the campus will also be home to several advanced-research facilities and training centers for employees to further develop the world-class design skills that have made MUSIC Group a highly-respected industry leader.

MUSIC Group is working closely with expert firms to maximize energy-efficiency and minimize the carbon footprint, in keeping with the company's goal of exceptional environmental stewardship. The Company's employees will literally call the new campus home, with as many as 5,000 living on-site and taking advantage of a wealth of amenities, including a variety of dining options, on-premises childcare, medical services – and a vast array of recreational facilities.

With a 24/7 crew of 1,000 workers on-site, construction is scheduled to be completed by mid 2014.

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